Analyst at Piper Jaffray reiterates Neutral rating and raises price target to $57 from $55 following strong second quarter financials
David Amsellam, analyst at Piper Jaffray, reiterated its rating on Teva Pharmaceutical Industries Ltd (ADR) (NYSE:TEVA) stock to Neutral, but raised his Price target from $55 to $57 following the second quarter earnings report. The current price target indicates a 5.41% upside potential over the last close of $54.21, Friday August 5. Teva posted earnings of $1.25 per share on a non-GAAP adjusted basis, while revenue came in at $5.04 billion.
Mr. Amsellam commented: “Teva also provided more color on why it believes that generic competition on Copaxone 40 mg is not a nearer-term threat. That said, we would still argue that the longer-term earnings growth outlook is murky given that we will see lower court and appellate court decisions in the 2017/2018 timeframe.”
The Israeli multinational company is trading at 9 times its 2017 price to earnings ratio and 10 times its Enterprise Value to EBITDA ratio. The firm continues to believe that Teva has a limited potential for further value creation in the absence of any mergers and acquisitions. Given that, the firm believes it a foremost responsibility of Teva to significantly boost its brand commercial pipeline and portfolio. Thus, the firm has raised its PT by 3.63% as the discounting period utilized in their target price calculation has rolled forward.
The company has a market capitalization of $55.84 billion and 28.22 price to earnings ratio. The stock has a 52-week high of $71.08 and a 52-week low of $48.01. Out of the total analysts covering TEVA stock, 20 rate it a Buy, 7 rate it a Hold, while one rate it an Overweight. Share of Teva pharmaceuticals were down 2.24% yesterday.
Moreover, the company has recently announced to acquire generics business of Allergan in a deal valued at $500 million. Teva estimates the combined generics segment to garner $25 billion FCF and $1.4 billion in operational and tax savings in 3 years from now.